Hiring is the toughest challenge for entrepreneurs. Even experienced founders struggle — and there’s no shortcut to getting it right.

Hiring is one of the hardest challenges for entrepreneurs. Learn why even experienced founders struggle — and why there’s no shortcut to getting it right.

Everybody talks about how important hiring decisions are, and how high the costs of bad hiring decisions are.

It matches my experience as the Founder & CEO of Yonder. Besides hiring many great colleagues, I have made a few hiring decisions that cost us dearly.

If you’re looking for a simple recipe to fix your recruiting and hiring processes, please look for different articles. There isn’t a quick fix or a fancy AI algorithm to guarantee perfect recruiting.

Episode 1: How It All Starts

Founding a company with co-founders is in a way like marriage. You have known your co-founders for a long time, you know you can depend on them, you pool your financial resources, and you take the leap.

In the early days of a company, there isn’t any hiring, because the co-founders share all the work. From doing sales and product development right down to taking the trash out.

Episode 2: Hiring From Your Network

When you see some initial traction and you can’t do all the work yourself anymore, you start looking for suitable candidates. The perfect place to look for candidates is the co-founders’ network.

We have hired many great colleagues through our network. Some of them have been with us for 3–5 years. We wouldn’t be where we are today without the colleagues we hired through our network.

Often, people in our network introduced us to their network, which also led to some quality colleagues being hired in this way.

Episode 3: Scarcity

At some point, your network doesn’t produce more candidates and colleagues anymore.

Yet you still need to grow your team, so you start recruiting “the proper way”: Writing job descriptions, posting them online, and interviewing tons of candidates.

As a growing yet still small company, you face a double scarcity situation:

First, nobody knows your company. You’re not Apple or Google yet, so you will most likely not attract the same number of candidates for your job opening as the big guys. Furthermore, working in a 30-person company is not made for everybody.

Second, you still have no HR department. The founders do HR, and they have a lot of other tasks to do besides recruiting.

In such a situation, especially in tech, founders tend to resort to agencies to recruit their tech talent. We have worked with several agencies, with mixed results. Some agencies gave us tech personnel that they subcontracted through Upwork, while other agencies provide best-in-class tech talent that we treat like our own employees.

What Can Go Wrong?

If you don’t take the unicorn path and have the financial resources to build up a fully-fledged HR team, the scarcity situation described above is efficient, but some things can still go wrong.

First and foremost, your judgment might be wrong when making a hiring decision. It even happens to HR professionals. A good friend of mine has been in HR for more than 10 years and says it’s common to make wrong hiring decisions. Often, it has to do with people making an effort to pretend something they aren’t during the probation period, only to show their true personality some months after the end of the probation period.

Second, when you are growing a company, sometimes you’re in a hurry for additional hires. So even if you’re not 100% convinced that a person is the right fit, you might still end up hiring him or her — because you need those additional helping hands.

Last but not least, some people might be a great fit for the jungle phase of your company, but not very much for later phases. The transition from “good fit” to “poor fit” is not digital, but develops over time. Very often, leaders have difficulty with telling an employee that the time has come to move on — irrespective if this is an early employee hired from your network, or an employee hired through regular recruiting channels.

From my experience in larger corporations, it’s not just leaders having difficulty with such situations, it’s also HR. So then maybe it’s a good thing to keep HR in the founders’ hands so that you can make these unpleasant, but sometimes necessary decisions for the good of the company and the affected employees.